AVEO Oncology Reports First Quarter 2014 Financial Results

AVEO Oncology Reports First Quarter 2014 Financial Results
Business Wire
CAMBRIDGE, Mass. -- May 7, 2014
AVEO Oncology (NASDAQ:AVEO) today reported its first quarter 2014 financial
results and provided an update on its progress toward achieving its strategic
plan.
“We made solid progress executing on a key component of our recently announced
corporate strategy, which is to advance our clinical-stage assets through
collaborations while retaining substantial value,” said Tuan Ha-Ngoc,
president and chief executive officer of AVEO. “In March we re-acquired
worldwide commercial rights to AV-203, our ErbB3 inhibitor, from Biogen Idec,
which will allow us to find a partner to support further clinical development
of AV-203. In addition, in April we announced an innovative partnership with
Biodesix, a private diagnostic company, to advance the clinical development of
ficlatuzumab, our HGF inhibitory antibody. We expect to initiate a
proof-of-concept clinical trial of ficlatuzumab in non-small cell lung cancer
by the end of the year, subject to discussions with the Food and Drug
Administration.”
Recent Operational Highlights
*Re-acquired rights to AV-203, AVEO’s ErbB3 inhibitor, from Biogen Idec in
March 2014. By re-acquiring these rights, AVEO will be able to seek a
partner with established oncology capabilities to accelerate and
financially support the clinical development of this asset.
*Executed an agreement with Biodesix in April 2014 under which AVEO plans
to conduct a proof of concept study of ficlatuzumab in combination with
erlotinib in advanced non-small cell lung cancer using Biodesix’s
VeriStrat® test to select for a patient population which did not respond
well to epidermal growth factor receptor (EGFR) tyrosine kinase inhibitor
(TKI) therapy, but responded to the combination therapy in an exploratory
analysis of AVEO’s Phase 2 trial data. Biodesix will fund up to $15
million of the cost of the study. Any additional development, regulatory
and commercial costs for ficlatuzumab beyond the proof of concept study
will be shared equally between AVEO and Biodesix, as will any potential
profits.
*AVEO and Astellas announced the termination of their tivozanib
collaboration pursuant to which Astellas will return all rights for
tivozanib to AVEO in August 2014. At that time AVEO plans to explore
potential partnership opportunities to support the further clinical
development of tivozanib.
Q1 2014 Financial Highlights
“We remain on target to end 2014 with a cash balance of between $50 and $55
million,” said Tuan Ha-Ngoc. “In the first quarter AVEO reported cash
expenditures of $30 million, approximately half of which are related to
facilities and site costs. The majority of these site costs are reimbursable
through our lease arrangement and were incurred as construction nears
completion on our 650 Kendall offices and labs where our operations will be
consolidated.”
*Ended Q1 2014 with $88.3 million in cash, cash equivalents and marketable
securities.
*Total collaboration revenue was approximately $15.3 million compared with
$0.3 million for Q1 2013. The increase was primarily due to an additional
one-time recognition of $14.1 million of previously deferred revenue as a
result of the modification of the company’s arrangement with Biogen Idec.
*Research and development (R&D) expense was $11.8 million compared with
$21.0 million for Q1 2013. The decrease in R&D expense was primarily due
to a reduction in personnel-related expenses following AVEO’s June 2013
strategic restructuring as well as a decrease in external clinical trial,
consulting, and manufacturing costs associated with development and
pre-commercialization activities for tivozanib.
*General and administrative (G&A) expense was $5.6 million compared with
$12.4 million for Q1 2013. The decrease in G&A expense was primarily due
to a reduction in personnel-related expenses following the company’s June
2013 strategic restructuring and a decrease in marketing and consulting
costs for tivozanib related to pre-commercialization activities.
*Net loss for Q1 2014 was $6.5 million or a loss of $0.12 per basic and
diluted net loss per share compared with net loss of $34.1 million or a
loss of $0.69 per basic and diluted net loss per share for Q1 2013.
2014 Financial Guidance
Based on current operating plans, AVEO continues to expect to end 2014 with
approximately $50-$55 million in cash, cash equivalents and marketable
securities.
Upcoming Q2 Events
AVEO’s Phase 1 dose-escalation study of AV-203 has been accepted for a poster
presentation at the 2014 Annual Meeting of the American Society for Clinical
Oncology in June.
AVEO expects to present at the 2014 Jefferies Healthcare Conference, June 2-5
in New York City.
About AVEO
AVEO Oncology (NASDAQ: AVEO) is a biopharmaceutical company committed to
discovering and developing targeted therapies designed to provide substantial
impact in the lives of people with cancer by addressing unmet medical needs.
AVEO’s proprietary Human Response Platform^TM provides the company with unique
insights into cancer and related disease biology and is being leveraged in the
discovery and clinical development of its therapeutic candidates. For more
information, please visit the company’s website at www.aveooncology.com.
Forward-Looking Statements
Private Securities Litigation Reform Act of 1995 that involve substantial
risks and uncertainties. All statements, other than statements of historical
facts, contained in this press release are forward-looking statements. The
words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,”
“target,” “potential,” “could,” “should,” “seek,” or the negative of these
terms or other similar expressions, are intended to identify forward-looking
statements, although not all forward-looking statements contain these
identifying words. These forward-looking statements include, among others,
statements about AVEO’s plans to initiate a proof of concept study of
ficlatuzumab, AVEO’s advancement of its business strategy, including entering
into new strategic partnerships, and AVEO’s estimates for its 2014 year-end
cash balance. Actual results or events could differ materially from the plans,
intentions and expectations disclosed in the forward-looking statements that
AVEO makes due to a number of important factors, including risks relating to:
AVEO’s ability to execute on its business plan and re-align its resources
behind key development opportunities; AVEO’s ability to successfully enroll
and complete clinical trials and preclinical studies of its product
candidates; AVEO’s ability to demonstrate to the satisfaction of the FDA, or
equivalent foreign regulatory agencies, the safety, efficacy and clinically
meaningful benefit of its product candidates; AVEO’s ability to achieve and
maintain compliance with all regulatory requirements applicable to its product
candidates; AVEO’s ability to obtain and maintain adequate protection for
intellectual property rights relating to its product candidates and
technologies; developments and expenses related to AVEO’s ongoing shareholder
litigation and SEC inquiry; AVEO’s ability to raise the substantial additional
funds required to achieve its goals; adverse general economic and industry
conditions; competitive factors; AVEO’s ability to maintain its strategic
partnerships and relationships, such as the collaboration with Biodesix
described in this press release; and those risks discussed in the section
titled “Risk Factors” included in AVEO’s most recent Quarterly Report on Form
10-Q and in its other filings with the SEC. The forward-looking statements in
this press release represent AVEO’s views as of the date of this press
release. AVEO anticipates that subsequent events and developments will cause
its views to change. However, while AVEO may elect to update these
forward-looking statements at some point in the future, it specifically
disclaims any obligation to do so. You should, therefore, not rely on these
forward-looking statements as representing AVEO’s views as of any date
subsequent to the date of this press release.
AVEO Pharmaceuticals, Inc.
Consolidated Balance Sheet Data
(In thousands)
(Unaudited)
March 31, December 31,
2014 2013
Assets
Cash, cash equivalents and marketable securities $88,322 $118,506
Accounts receivable 1,254 984
Prepaid expenses and other current assets 16,001 9,429
Property and equipment, net 19,011 14,140
Other assets 3,217 3,287
Total assets $127,805 $146,346
Liabilities and stockholders’ equity
Accounts payable and accrued expenses $16,382 $17,501
Total loans payable 16,731 19,205
Total deferred revenue 3,101 18,392
Total deferred rent 22,595 20,072
Other liabilities 4,730 1,238
Stockholder's equity 64,266 69,938
Total liabilities and stockholders’ equity $127,805 $146,346
AVEO Pharmaceuticals, Inc.
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
For the Three Months
Ended March 31,
2014 2013
Collaboration revenue $15,289 $323
Operating expenses:
Research and development 11,767 20,962
General and administrative 5,555 12,449
Restructuring and lease exit 3,859 67
21,181 33,478
Loss from operations (5,892) (33,155)
Other income and expense:
Other income (expense), net 7 (101)
Interest expense (581) (870)
Interest income 16 41
Other expense, net (558) (930)
Net loss $(6,450) $(34,085)
Net loss per share - basic and diluted $(0.12) $(0.69)
Weighted average number of common shares outstanding 51,634 49,380
Contact:
AVEO Investor Relations
617-299-5810
or
Media:
Rob Kloppenburg, 617-299-5990